Channel 4 submission to the BBC Trust s review of BBC services for younger audiences

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1 Channel 4 submission to the BBC Trust s review of BBC services for younger audiences 1. Channel 4 welcomes the opportunity to provide its views to the BBC Trust s review of BBC services for younger audiences. Channel 4 is a publicly-owned, commercially-funded public service broadcaster. Its core public service channel, Channel 4, is a free-to-air service funded predominantly by advertising. Unlike the other commercially-funded public service broadcasters, Channel 4 is not shareholder owned: commercial revenue is only a means to delivering Channel 4 s public purpose end and any surplus revenues are reinvested in the delivery of its public service remit. 2. In recent years, Channel 4 has broadened its portfolio to offer a range of digital services, including the free-to-air, commercially-funded digital television channels Channel 4+1, E4, E4+1, Film4, More4 and 4Music. Channel 4 also offers a video on demand service, 4oD, and it is expanding its range of services at channel4.com. In addition, Channel 4 offers a range of online education projects for 14 to 19 year olds and has launched an innovation pilot fund, 4iP, which seeks to stimulate whole new digital media services across a range of areas, including video games, the arts, democracy and sport. 3. These innovations have allowed Channel 4 to stay in touch with audiences especially younger viewers who are rapidly migrating to digital media. Ever since its launch in 1982, Channel 4 s brand has resonated particularly strongly with teenagers and younger adults, and the organisation speaks with an authenticity of voice which is not easily replicated by other public institutions. 4. Channel 4 also maintains a strong connection with younger audiences through its educational content, which remains a core and important part of Channel 4 s public service remit and purposes. Channel 4 produces distinctive education content for young people, often tackling subjects other broadcasters don t cover, and with an authentic, non-judgmental attitude appreciated by younger audiences. Channel 4 s education content includes peak time programmes and online services, and the channel broadcasts over 330 hours of schools programming per year. Channel 4 has adopted a pioneering approach to content for 14 to 19 year olds by focusing resources on digital content, moving its 5 million annual budget for education programmes from linear television to multiplatform projects. 5. Channel 4 therefore has a unique relationship with younger audiences, making it well placed to comment on public service provision in this area. In this context, Channel 4 would like to make the following points to help inform the BBC Trust s review. Channel 4 believes that it is vital for the public service broadcasting system as a whole to provide high quality, UK-originated content to younger audiences across a range of platforms. Channel 4 is the leading broadcast brand for younger adults, and its distinctive content is better able to reach this group compared to content provided by other public service broadcasters, including the BBC. While Channel 4 has some sympathy for the BBC s aspirations to provide content that better appeals to younger audiences, Channel 4 believes there is a real danger that the BBC might use a disproportionate amount of resources - 1 -

2 targeting this group. Given the strong provision elsewhere, the BBC could reprioritise its resources towards services for younger audiences more in line with the BBC s tone and style. Channel 4 recognises the importance of public service providers playing distinctive, complementary roles in catering for younger audiences. Different broadcasters have different strengths and appeal to different audiences. The BBC should not seek to replicate Channel 4 s distinctive tone and approach to engaging with younger audiences: instead, the BBC should work to its own strengths in defining the type of role it plays for this group in future. The BBC s activities may have a negative impact on provision for younger audiences from commercial competitors and may also create uncertainty in new markets, thus inhibiting innovation. The BBC should therefore target its output by looking at what is provided elsewhere, clarifying the boundaries of its activities for younger audiences in some areas, in order to limit its negative impact on the wider market. 6. The remainder of this submission discusses these points in greater detail. Channel 4 s distinctive role in reaching younger audiences 7. Audiences in the UK have benefited from a broadcasting system characterised by a plurality of public service providers. Within the system, different broadcasters play distinctive roles in delivering content to different audiences. As a result, the existence of a range of public service broadcasters has ensured that publicly valuable content reaches a wide range of audiences, including harder to reach groups such as younger audiences. 8. While the BBC and ITV, for example, generally achieve sizeable audiences, Channel 4, relative to its size, is far more successful at reaching younger audiences. Channel 4 s services also resonate strongly with this group, and its brand has a unique appeal for younger audiences. Channel 4 is the leading broadcast brand for younger audiences 42% of year olds nominate Channel 4 as their favourite PSB channel making the channel well-placed to reach this group with a range of high quality content. Channel 4 s role in this regard is likely to become relatively more important in future over the last six years, Channel 4 s portfolio share of year olds has grown by 16%, while the BBC s portfolio share of year olds has fallen by 19%. 9. Looking at the BBC s services, Channel 4 is also more successful at reaching younger audiences compared to BBC Three, the BBC s dedicated channel for this group. In 2007, core Channel 4 reached over 80% of year olds in multichannel homes in an average month, while BBC Three reached only 50% of this audience. In addition, Channel 4 s youth-orientated digital channel E4 reached a greater proportion of year olds in multichannel homes than BBC Three (53% for E4 compared to 50% for BBC Three). 10. The success of Channel 4 in this respect has ensured that high quality public service content reaches younger audiences. This does not only include programmes readily associated with this group, such as Hollyoaks, but a wide variety of content spanning a range of genres. For example, the top ten Channel 4 programmes most viewed by year olds this year includes award-winning drama such as Shameless, and the top ten Channel 4 programmes rated as original and different by year olds includes documentaries that inspire - 2 -

3 change in people s lives, such as Hugh s Chicken Run and Can t Read, Can t Write, health programmes such as Embarrassing Bodies and The Sex Education Show, and award-winning comedy such as Peep Show. 11. Channel 4 s exciting multiplatform education projects further demonstrate Channel 4 s ability to reach younger audiences. Current projects include Year Dot, which looks at how social networking can help young people achieve their ambitions; Battlefront, which helps teenagers build individual campaigns on different platforms and reach new audiences; and The Insiders, which uses short-form comedy and blogs to help young people to better understand potential career paths. The projects have already been a demonstrable success, with the Battlefront website achieving over 230,000 page views and over 21,000 video views in the past four months and the Year Dot website and related MySpace page achieving 120,000 visits and 190,000 video views between them over the past six months. Implications for the BBC s services for younger audiences 12. Given Channel 4 s relative strength in reaching younger audiences with innovative public service content, it is hard to see why the BBC should seek to replicate Channel 4 s distinct approach. In recent years, the BBC s services, especially BBC Three, have increasingly imitated Channel 4 s unique approach to engaging with younger audiences. For example, following BBC Three s re-launch last year, one of its first big projects was a series of one-off drama pilots, all of which seem to be clearly chasing the Skins audience. In addition, the BBC Three sitcom Coming of Age, which follows the lives and loves of a group of teenagers at school, touches on many similar issues to E4 s The Inbetweeners, while BBC Three s Celebrity Scissorhands is very similar to Channel 4 s The Salon, albeit with the addition of celebrities. 13. The PSB system is designed such that different broadcasters reach different audiences with different approaches. The BBC s relative lack of success in reaching younger audiences does not mean that it should try to replicate the approach of other brands that resonate more strongly with this group. Given that other broadcasters already successfully occupy this space, there is a real danger that the BBC might use a disproportionate amount of resources targeting younger audiences, and Channel 4 believes that the BBC could reprioritise its resources away from underperforming services for younger audiences (such as BBC Three), instead focusing on services for younger audiences more in line with the BBC s tone and style. 14. That said, in areas where Channel 4 and the BBC are clearly pursuing public service objectives education, for example Channel 4 would be open to engaging in a dialogue with the BBC about potential partnership opportunities. In certain public purpose areas, where the BBC and Channel 4 provide complementary, distinctive services, there may be opportunities to pool resources to the benefit of the public service broadcasting system as a whole. The BBC s services need to take account of developments in markets 15. Channel 4 believes that the BBC s activities may have a negative impact on market provision for younger audiences from commercial competitors, including Channel

4 16. The BBC s services for younger audiences enjoy substantially greater levels of funding than services provided by commercial competitors. In addition, the BBC s funding for these services is guaranteed and is not subject to commercial pressure, such as the huge decline in advertising revenues currently facing commercially-funded public service broadcasters. Channel 4 believes that this imbalance has the effect of skewing the market for talent and programming, as the BBC can use its privileged position to gain an advantage over competitors. The difference in strength between the BBC and commercial broadcasters can be seen by looking at the respective budgets for the BBC s and Channel 4 s services for younger audiences. In 2007/08, for example, BBC Three s content budget was just under 100 million, which far exceeded the 2007 programme budget of E4, Channel 4 s youth-orientated service. 17. As the BBC Trust is well aware, following its decision in March 2007 to suspend the BBC s online education service BBC Jam, commercial competitors have serious concerns about the impact of the BBC s education and formal learning services. While the BBC Trust rightly decided to suspend BBC Jam, Channel 4 has a number of outstanding concerns relating to the BBC s formal learning provision. These concerns arise as a result of Channel 4 s stake in education company Espresso Education Limited, which in March 2007 took over 4Learning, Channel 4 s education rights exploitation business. 18. In particular, Channel 4 is concerned that the BBC products Bitesize and Learning Zone Broadband have developed to become directly comparable to commercial products. The scope of both of these products has expanded materially in recent times Bitesize growing to include a broad set of linked interactive online resources and Learning Zone Broadband developing into a large online archive of clips available on-demand. Channel 4 understands that many teachers now consider these products as alternatives to commercial interactive learning resources, such as those offered by Espresso. Given the expansion in the scope of these services, and the potential negative market impact, Channel 4 believes that the BBC Trust should set tighter guidelines around the BBC s activities in this area and ensure that they are sufficiently distinctive to other services. This would be in line with the BBC Trust s duty to take proper account of the competitive impact of the BBC on the wider market. 19. More broadly, Channel 4 is concerned that the BBC s services for younger audiences may create uncertainty in new markets and also inhibit the development of new services. Channel 4 believes that cross-platform service BBC Switch which includes television, radio and online elements may threaten the development of services in each of these areas from Channel 4 and other content providers. In particular, the presence of the BBC in the rapidly developing online market could have the effect of crowding out smaller providers and discouraging new entry. In addition, while the creation of a single brand and online portal for the BBC s younger audiences may be helpful, Channel 4 believes that significant investment in content by BBC Switch could have a negative impact on the market by driving up the price of content for other providers. Implications for the BBC s services for younger audiences 20. Channel 4 believes that the BBC s services for younger audiences need to take into account developments in markets and technologies. Some of the BBC s - 4 -

5 services for younger audiences, such as its formal learning services, are encroaching on services provided by commercial competitors, and other services, such as BBC Switch, may have a negative impact on developing markets. Channel 4 therefore believes that the BBC Trust should clarify the boundaries of its activities for younger audiences, in order to limit the BBC s negative impact on the wider market. In this way, appropriately defined BBC services can sit alongside and complement commercial provision, bringing a range of high quality content to younger audiences. Concluding comments 21. Channel 4 believes that it is vital for the public service broadcasting system as a whole to provide high quality, UK-originated content to younger audiences across a range of platforms. Within this system, it is important to recognise that different broadcasters have different strengths and appeal to different audiences. Channel 4 believes that it should not be the default position for the BBC to expand into every possible area for younger audiences, particularly areas where other parties, such as Channel 4, already have a strong, distinctive presence and deliver substantial public value. 22. To ensure the full range of public service provision for younger audiences, Channel 4 believes there needs to be provision from a plurality of public service broadcasters, including the BBC and Channel 4. However, plurality and distinctiveness are not at odds. The roles of different broadcasters can and should differ the BBC should play to its strengths and not try to replicate the services provided by organisations that have a unique relationship with younger audiences, such as Channel December

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